Next Bull Cycle Dawn Is on the Horizon

by Alex Benfield
By Alex Benfield

The current crypto climate appears to be hinting that a few more overcast months are in our near future. It's a period that might challenge even the most seasoned investors and possibly sway some to step back. 

Yet, history and patterns suggest that such moments are precisely when the most resilient decide to hold their ground. 

Let’s start with what we will likely be facing in the near term. Each passing rally in the crypto sphere has been marked by a subtle decrease in volatility, suggesting a waning momentum after a commendable surge during this transitional year. 

Still, Bitcoin (BTC, “A-”) deserves a nod, having risen an impressive 65% this year. Its performance, characterized by a series of higher lows throughout the year, has lately been interspersed with a couple of lower highs. 

This suggests that Bitcoin may soon snap its trend of consistent higher lows in the near future. 

Historical data from this year indicates that price corrections have consistently hovered around the 20% mark, so a dip ranging between 15% to 25% might be on the horizon. That could take Bitcoin to somewhere between $21,000 - $23,000, which is where I believe the market will find its final support. 

Source: Coinbase.
Click here to see full-sized image.

 

I would be remiss if I didn’t note that there is a possibility BTC could drop below $20,000, however bulls would likely step in very quickly to eat up the order book and provide support at those levels. Money has been sitting on the sidelines waiting for a good entry point, and dips to those levels would offer just that. 

Altcoin enthusiasts should brace themselves for potentially steeper drops, prolonged corrections and a delayed rebound compared to Bitcoin. 

In times of market transitions, Bitcoin usually commands the limelight. However, it's essential to remember the internal cycle within the crypto market: Altcoins fall much harder and faster than Bitcoin during the bear market, then they lag behind Bitcoin at the start of the bull.

So, why should we be concerned about alts? Because eventually, they start to pop and surge with even greater intensity during the big bullish phases. 

Money will flow from Bitcoin to other large blue chips before finally finding its way to smaller altcoins throughout the cycle. It's precisely this cyclicality, both internal and external to the market, that provides so many trading opportunities. 

Already, it looks like the usual leader of the altcoins, Ethereum (ETH, “B”), is following this pattern. It’s getting very close to setting a lower low and appears to be leading Bitcoin on the way down right now. 

Ethereum should find some support at the $1,450 level. If that doesn’t hold, there is even stronger support around the $1,300 - $1,350 range.

Source: Coinbase.
Click here to see full-sized image.

 

Ethereum is likely to remain volatile in the months ahead and is unlikely to rally hard without a similar rally in Bitcoin. 

However, as soon as the market sentiment turns and the next bull run begins, ETH is likely to outgain Bitcoin once again. 

Stay patient.

What’s Next

While the near-term corrections may bring down sentiment, I did say there was hope on the horizon. 

That’s because we're nearing the end of this year-long neutral phase. 

And soon, events like the Bitcoinhalving will reduce its supply, potentially increasing its demand. Combine that with discussions about spot Bitcoin ETFs that could bring in a wider pool of investors and the storm starts to show its silver linings. 

Finally, with the broader economic factors — such as potential money printing and the natural tendency to flock to reliable assets like gold and Bitcoin during turbulent times — in the mix, the first rays of a brilliant dawn could be peaking over the horizon.

You know how the old saying goes: The darkest moments are right before the dawn. 

And in these darker times in the market, it's the stalwarts, with their unerring patience, who often navigate to prosperous shores. 

My colleague, Juan Villaverde, is one such stalwart. But he has something others in the industry don’t — his proprietary Crypto Timing Model. 

He uses this tool to analyze the market and track the crypto cycles that help him identify not only what assets to target, but when to target them. 

If you want to learn more about the Crypto Timing Model and the cycles themselves — as you should do now, before the next bull market is underway — then I suggest you check out this timely video.

In it, we break down how Juan used these tools to bag massive gains on top cryptos like Bitcoin, Ethereum and Cardano (ADA, “C+”) and how you can get specific “Buy” and “Sell” recommendations directly from Juan and the Crypto Timing Model.

This video won’t be available for long, so you should watch it now, before it goes offline.

Best,

Alex

About the Crypto Analyst

Alex has been actively researching and investing in cryptocurrencies since 2017. He contributes research and reports to several Weiss crypto publications, with a primary focus on helping to create crypto trading strategies.

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